Home sales down by 70%

[NewsWhore]

The sale of living quarters, single-family houses, condominiums and apartments has fallen by 70% this year over last. Meanwhile, construction has tailed off by a 30% to 40% margin in 2008. According to Listin Diario, the cost of construction materials used in housing construction increased by 17.5% from January to August, according to statistics from the Dominican Chamber for Construction. In July this year the cost of materials for single-family dwellings increased 19.5% from September 2007. The plight of the construction sector was outlined for the editors of Listin Diario by Diego de Moya, the president of the Chamber for Construction, Christian Maluf Khoury, vice-president and Jaime Gonzalez the president of the Dominican Association of Builders and Promoters (ACOPROVI). They said that a country's development is measured by its infrastructure. They said that since 1997, the cost of building supplies has risen by 349%, and just over the past eight months a bundle of re-bar had increased 100% in price. According to these experts, an important factor in the fall in home sales is the rise in interest rates, which have gone from 10% to 22% (and 24% in some cases). According to de Moya, a 1% increase in the interest rate on home loans is equal to a 5% reduction in the debt capacity of a potential homebuyer. Other factors driving home sales down are transport costs and increased salaries for construction workers, as well as the huge increase in the price of cement.

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